Hoshin Kanri is a management system that creates a method of policy deployment in the form of both organizational and employees goals. It is a step by step implementation and review process from a systems approach perspective for change. In the simplest form, top management sets a vision and bottom line employee sets the tactics. In the middle, there is a lot of give and take and coordination through the use of a term catchball that results in:

  • Prioritizing activities and resources
  • Organizational involvement from top to bottom clarify their own target and activities
  • Utilizing PDCA in both the management and employee cycles of improvement

The difference in Hoshin planning is that we do not accept the current situation but seek to aspire to something greater. We seek solutions between the current and aspired state by bridging the gap through the process of Kanri the other part of the process. Kanri is defined as a method to efficiently achieve purposes through PDCA (Plan-Do-Check-Act).

Hoshin Kanri is different than just your typical continuous improvement is that we are not solving the typical workplace problem but rather the value-added problems based on top management thinking (Vision and Targets). The “Hoshin” is developed at each layer of management clarifying strategies and targets to assist in reaching the preceding layer’s targets. This results in both a macro and micro PDCA. This greatly increases the line of sight and shared responsibility to each other in achieving these goals.

The workplace mission is defined within Toyota from the question “For whom and what type of value added products and services should be provided?” In this way, measures are created from the value added problems determined in the Hoshin process. Breaking the annual strategy down to what I call “Doable Chunks” is one of the secrets to Hoshin Kanri’s success.

It is not only the task but the team size that will assist in a positive outcome. Jeff Bezo’s of Amazon fame always used what he called the two pizza rule. If you needed more than two pizzas to feed the group, the group was too big. Smaller groups promote: informal communication, better assignment of tasks, more manageable task, increase participation, reduces information needed to be processed and most importantly – A CLEAR LINE OF SIGHT.

The approaches of Hoshin Kanri and Leader Standard Work seem to have a common thread in them. It is one of shared work and responsibilities and as a result regular feedback or reflection. It makes the management process continuous over something more formal such as a review.

Go to the next page Hoshin/Train

Bonus Material:

Is Hoshin Kanri Different than Management by Objectives? From a comment by Casey Ng (TERA PRUDENT SOLUTIONS PT):

Being personally gone through a number of stages of Hoshin Kanri before it taking its final shape today. I had no doubt about the similarity of MBO to Hoshin Kanri. Someone may be able to tell whether Hoshin Kanri was originally base on Drucker’s Management by Objective back in 1956.

In the late 80’s we called Hoshin Kanri “Policy and Activities”, it was quite simple, annually, we shared our ideas of what needed to be changed or implemented in the current year, then we put the themes on the left hand side of the paper and listing up the activities to implement them. Very rarely we concerned about target setting or measurable. Considering at that time, desk top computers are still very rare commodities. A3 size report was in the infancy of hand written reports with pencil diagrams. Gantt charts and other fancy presentation was remotely luxury.

Comparing today’s Hoshin Kanri to MBO, the main differences are the relentless asking the questions of “Why” and “How”, instead of just applying the “North Bound Train” concept of Objective and targets setting that basing on historical performance.

Most good Hoshin has breakthrough components in it, whether measurable or not, it becomes secondary important.

In the breakthrough journey, the clear articulation of the optimum stage is very important, but after reality check and setting up conditions for the next achievable goal, the ideal situation needs to be defined. Then develop the “how” and only then consider the targets.

I always use a simple example to explain the differences between “Optimum Goal” and “Ideal Situation”

Optimum Goal: Our car will not kill any pedestrian in accident”

Ideal situation: The design of our car will reduce the potential of killing pedestrian in accident at 40 KM/H”

The above are my view about the different of Hoshin Kanri to MBO.

Recommended Books:

Hoshin Kanri for the Lean Enterprise: Developing Competitive Capabilities and Managing Profit

Beyond Strategic Vision: Effective Corporate Action With Hoshin Planning

The Toyota Way to Lean Leadership: Achieving and Sustaining Excellence through Leadership Development